Limitation of Efficiency: Strategy-Proofness and Single-Peaked Preferences with Many Commodities

Hiroo Sasaki
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Hiroo Sasaki: Rice U and Waseda U

Working Papers from Rice University, Department of Economics

Abstract: In this paper, we study a resource allocation problem of economies with many commodities and single-peaked preferences. It is known that the uniform rule is the unique allocation mechanism satisfying strategy-proofness, Pareto efficiency and anonymity, if the number of good is only one and preferences are single peaked. (Sprumont [7].) However, if the number of goods is greater than one, the situation drastically changes and a tradeoff between efficiency and strategy-proofness arises. The generalized uniform rule in multiple-commodity settings is still strategy-proof, but not Pareto efficient in general. In this paper, we show that in a class of all strategy-proof mechanisms the generalized uniform rule is a "second best" strategy-proof mechanism in that there is no other strategy-proof mechanism which gives a "better" outcome than the generalized uniform rule in terms of Pareto domination.

Date: 2003-02
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Persistent link: https://EconPapers.repec.org/RePEc:ecl:riceco:2003-01

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